Cuba by the numbers
Population: About 11.4 million
Land mass: About the size of Pennsylvania
Cuba's ranking among destinations for Georgia exports: 87th overall, 31st among agriculture products
U.S. exports to Cuba in 2014: $299.1 million, the lowest since 2003
U.S. exports to Cuba in 2007: $711.5 million
Georgia exports to Cuba in 2013: $27.5 million, down 24 percent from 2012
Key Georgia exports to Cuba: Poultry, animal feed products and prepared meat and seafood products
Cuba's top trade partners: Venezuela, China, Spain, Brazil, USA
Sources: CIA World Factbook, Georgia Department of Economic Development, Georgia Department of Agriculture, U.S. Census Bureau
HAVANA – Three days into Mayor Kasim Reed's trip to Cuba, the enormity of the country's needs is coming into focus.
Under the financially-strapped Communist government, the country is crumbling. Across Havana, in particular, cobblestone streets and statuesque Spanish Colonial buildings are in dire need of repair. Many things, from delivering food to accessing the Internet, are difficult here, lacking the ease and efficiency to which Americans have grown accustomed. And the people, despite their college educations, receive about the equivalent of $20 U.S. dollars per month through their government. Many say they hope that foreign investment will bring more and better-paying jobs.
In all of those things, Atlanta leaders see possibilities, but also challenges.
“I wasn’t prepared for the breadth of the opportunities, nor was I prepared for the difficulty related to those opportunities,” Reed said Monday, after meeting with officials from Cuba’s new Mariel Port.
Reed is here with a group of business leaders, academics and government officials to assess the potential for future trade between Atlanta and Cuba, should the U.S. embargo be lifted. While Miami is the dominant American city to Cubans, he’s pitching Atlanta – with its international airport and plethora of Fortune 500 companies – as a new business center for Latin America.
The mayor believes Atlanta and Georgia are well-equipped to have a role in helping Cuba solve some of its problems, noting that hometown giants UPS, Delta Airlines and Hartsfield-Jackson International Airport are experts in logistics and aviation systems. Metro Atlanta is also a hub for telecommunications, medical technology and payments processing.
Reed, like several on this trip sponsored by the World Affairs Council of Atlanta, sees endless opportunities. But given Cuba’s complicated, government-controlled way of doing business, getting U.S. political leaders to lift the long-standing trade embargo seems the easy part.
“When you get here, there’s no question that there is a real need for almost everything, and there is a need for systems where we have expertise,” he said. “The opportunities we had in mind when we decided to come here are real, but the question is how you work through the word we have heard most often in presentations: Complexity.”
Significant hurdles
Even if the embargo was lifted tomorrow, many here said, Cuba has far to go in enticing American businesses to invest in this Communist country. Why? Many of its rules would make most Americans balk.
For starters, foreign companies cannot directly hire workers. Instead, they must use a state-run employment agency. Nor can they directly compensate their workers. Salaries are paid through “the state,” as locals call it, with the government keeping more than half of the wages.
What’s more, foreign companies can’t own the land on which they do business, and must lease it from the Cuban government. Government officials here recently expanded lease terms from 50 years to 99 years, Reed said, a move that could attract some outside investment.
A billboard leading into Havana decried the U.S. trade embargo as “genocide,” some noted. But Charles Shapiro, the former ambassador to Venezuela who is now the president of Atlanta’s World Affairs Council, believes that’s part of a longstanding attempt to blame America for the Castro government’s shortcomings.
“The embargo has been a pretext for Cuba to explain the failings of its economy, but in reality, the Cuban economy does not work,” he said Sunday night. “They have to make more flexible the areas that foreign companies can expand in.”
Nathan Bennett, an associate dean and professor at Georgia State University’s J. Mack Robinson College of Business, looked exasperated as the Atlanta contingent left Monday’s session with Mariel Port officials — a meeting government leaders here said was off-the-record to the press. The Brazilian government is helping Cuba finance a $1 billion new port and factory hub in preparation for increased exports. Some hope American businesses will one day invest here.
But “there is so much work to be done before an American company can actually make an intelligent decision,” Bennett said.
Pointing to the labor issue, he said: “I don‘t know that an American company, or any global company, is going to make a significant capital investment without a guarantee of the quality of the workforce.”
Opportunity is there
Jorge Fernandez, the vice president of global commerce with the Metro Atlanta Chamber, spoke of meeting with a Spanish meat purveyor who had difficulties selling his product to hotels as deals must be brokered through the government.
“Unless that changes, Home Depot will not be able to be part of the restructuring of the city,” Fernandez said on Sunday night, as Atlantans shared their impressions of Cuba over drinks at the famous Sloppy Joe’s bar downtown.
Still, he’s seen far more economic activity than he expected, he said. Without question, there’s a quiet hum of entrepreneurship emerging across the tiny country.
In what many say is a recognition that Cuba can no longer afford to provide jobs to all of its people, the country began issuing a limited number of small business permits to certain types of workers in recent years.
That’s given birth to shops like that owned by Gilberto Valladares, who operates a small hair salon and art gallery out of his apartment in Old Havana. Like the rest of the city, seemingly frozen in the 1950s, his salon was decorated entirely with brightly colored antique and mid-Century salon chairs.
Valladares, like many Cubans, spoke about his country’s future without criticizing the Castro government.
“This is a really important time in Cuba. The private sector is growing and it’s getting a space in Cuban society,” he said through a colleague and interpreter.
Cuba’s future is in the “micro-scale,” he said, with people focusing on the things they can do to transform their own communities.
Valladares said a crop of new businesses have sprouted in his neighborhood, inspired by private enterprise that gives back to the community. There’s even a new playground for children down the street.
“We dream that one day, Cuba will be like this in our entire country.”
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